In addition, the research showed that 75% have faith in the stability of the market to withstand further economic pressures and remain at least at the same levels.
The sector’s ability to fulfill a growing consumer need (75%) and meet changing retirement requirements (38%) were highlighted as two of its key strengths. Indeed, these strengths have led to far greater engagement between the equity release industry and Government than ever before, and members believe this will continue over the course of the year (80%).
In addition to engagement, 60% of respondents believe that the Government will look to the industry for help with public policy issues such as meeting the pensions gap and funding care. The majority of members (60%) also believe that there is potential for a Government department to step forward to “own” equity release, thus providing a further endorsement in the minds of consumers.
Amidst this positive view is the acknowledgement that there will also be challenges ahead. Eighty-six per cent believe that SHIP needs to continue to work to increase awareness and understanding of equity release amongst the Government and consumers, in order to overcome problems faced including a lack of understanding and confidence in the products (25%).
In addition, there will be tests in the form of legislation, such as the impact of the Retail Distribution Review (RDR) and the Mortgage Market Review. However, 63% of respondents believe that RDR will have no real impact upon the equity release market, and an even greater 67% believe the same of the Mortgage Market Review.
Commenting, Andrea Rozario, director general of SHIP, the equity release trade body, said: “Over the past twelve months, we have seen a growing acceptance of equity release as a retirement planning option amongst consumers, advisers and the Government. With longevity increasing and the Government making it clear that the state will not be able to provide all encompassing retirement funding, other options must be considered.
“However, it is important that those who are entitled to state support fully understand what this will involve. SHIP is currently running a campaign to clarify the relationship between equity release and state benefits, having found that many advisers and consumers find the current system in need of simplification.
“We need to build on the good work already done to ensure that consumers in particular understand equity release so that they are able to weigh it up alongside other retirement planning tools. There are many opportunities ahead for growth and engagement, and the appetite to do so is evident amongst providers.”